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Gold jumps 6.1 per cent to US$4,946 as geopolitical tensions override dollar weakness: What about Bitcoin?

Gold jumps 6.1 per cent to US$4,946 as geopolitical tensions override dollar weakness: What about Bitcoin?

Investors grew cautious about artificial intelligence potentially creating fiercer competition within the software sector, which kept sentiment fragile even as the partial United States government shutdown concluded late Tuesday after President Trump signed a funding agreement negotiated with Senate Democrats.

Meanwhile, the Reserve Bank of Australia made a decisive move by raising its key interest rate to 3.85 per cent from 3.60 per cent, marking the first major economy to tighten monetary policy this year after determining that inflation pressures remained stubborn enough to require renewed restraint. This divergence in global central bank approaches highlights an uneven economic landscape, with some regions facing persistent price pressures while others are preparing for easing cycles later this year.

United States equities retreated decisively, with the Dow Jones Industrial Average falling 0.34 per cent, the S&P 500 dropping 0.84 per cent, and the technology-heavy Nasdaq Composite declining 1.43 per cent. The selloff centred on software stocks following Anthropic’s release of Claude Co-work plug-ins, which amplified fears about competitive disruption in an already crowded artificial intelligence ecosystem.

Investors rotated capital toward economically sensitive sectors seeking broader exposure beyond concentrated technology holdings. This shift pushed the VIX Index to 18.00, its highest level in two weeks, signalling rising anxiety about near-term market direction. The uneven nature of the United States’ recovery suggests merit in considering alternatives to the standard S&P 500, such as an equal-weighted index or low-volatility strategies that provide more balanced sector representation while maintaining exposure to select cyclicals, such as financials and industrials, alongside defensive healthcare segments.

Treasury yields moved lower as the equity selloff gathered momentum, with the two-year note falling 0.2 bps to 3.570 per cent and the 10-year yield declining 1.2 bps to 4.265 per cent. This inverse relationship between stocks and bonds reflected a classic risk-off rotation, with investors seeking safety in fixed-income assets amid turbulence in the technology sector.

The move supports a strategic approach of extending bond duration to the five to seven-year range while accumulating high-quality investment-grade debt, particularly from developed and emerging-market sovereign and corporate issuers. These instruments offer attractive real yields in an environment where central banks may begin to ease later this year, though timing remains uncertain given persistent inflation dynamics in some economies.

Currency markets reflected subtle shifts in global risk appetite, with the United States Dollar Index declining 0.20 per cent to 97.437 as the greenback weakened against nearly all G10 counterparts. The euro strengthened to 1.1819 against the dollar, gaining 0.2 per cent, while the Japanese yen continued its struggle with USD/JPY, rising 0.1 per cent to 155.75.

This yen weakness stemmed from expectations of a strong election victory for Prime Minister Takaichi, which raised concerns about Japan’s fiscal sustainability and long-term debt trajectory. The broader dollar downtrend appears intact, with further Federal Reserve easing expected to dominate currency movements through the remainder of the year, potentially supporting additional gains in EUR/USD while pressuring USD/JPY lower on a broad dollar basis.

Commodity markets displayed sharp reactions to geopolitical developments, with Brent crude oil rising 1.6 per cent to settle at US$67/bbl after reports emerged that the United States Navy shot down an Iranian drone approaching an American aircraft carrier in the Arabian Sea.

This incident reignited tensions between Washington and Tehran, raising immediate fears of supply disruptions. Precious metals surged dramatically, with gold advancing 6.1 per cent to US$4,946/oz and silver climbing 7.4 per cent to US$85/oz. These gains reflected classic safe-haven demand as investors sought protection amid rising geopolitical risks and equity market volatility, though the underlying outlook for oil remains cautiously negative given structural supply dynamics.

Asian markets diverged positively from their Western counterparts, with regional indices gaining ground, lifted by the strength of precious metals and optimism surrounding a newly announced United States-India trade agreement. South Korea’s Kospi Index led regional advances with a remarkable 6.8 per cent jump, fuelled by a powerful rally in chipmaker semiconductor and memory chip-related stocks.

China’s Shanghai Composite added 1.3 per cent, while Taiwan’s TWSE closed 1.8 per cent higher, demonstrating resilience in technology manufacturing hubs despite weakness in United States tech shares. This divergence suggests regional markets may be pricing in different growth trajectories or benefiting from sector-specific catalysts that offset broader global risk aversion.

The cryptocurrency market declined 2.05 per cent to US$2.59T over 24 hours, primarily driven by a Bitcoin-led liquidation cascade that revealed the asset class’s tight correlation with traditional equities. Bitcoin’s drop below the psychologically critical US$74,000 level triggered a wave of forced closures on overleveraged long positions, with liquidations surging 149 per cent to US$263.49 million within a single day.

Ethereum dramatically underperformed, falling 24 per cent over seven days, which weighed heavily on the broader Layer 1 ecosystem, while the Fear and Greed Index plunged to 14, indicating extreme fear across digital asset markets. The 92 per cent correlation between Bitcoin and the S&P 500 underscores how macro liquidity conditions now dominate cryptocurrency price action more than idiosyncratic blockchain developments.

The near-term market trajectory hinges critically on whether Bitcoin can stabilise above US$74,000. A successful defence of this support level could catalyse a relief bounce toward US$77,200 to US$78,400, particularly if the United States spot Bitcoin ETF flow data shows renewed institutional accumulation.

Conversely, a decisive break below US$74,000 may accelerate selling pressure toward US$72,850, intensifying the current downtrend. The market exists in a fragile sentiment-driven state where technical factors like leveraged position unwinds interact with macro correlations, leaving little room for sector-specific catalysts to drive independent price action.

This confluence of factors paints a picture of markets navigating a delicate transition period. Technology volatility rooted in competition over artificial intelligence intersects with divergent global monetary policies and persistent geopolitical risks.

While US equities face headwinds from concentrated sector exposure, Asian markets show resilience, driven by semiconductor strength and optimism about trade deals. The cryptocurrency market’s sharp liquidation cascade ultimately reflects its current status as a risk asset tightly coupled to broader liquidity conditions rather than a diversifying alternative.

Investors would be wise to maintain balanced portfolios with quality fixed income allocations, defensive equity segments, and selective exposure to economically sensitive sectors, while carefully monitoring key technical levels in both traditional and digital asset markets. The path forward demands vigilance regarding central bank communications, earnings results, and geopolitical developments that could rapidly reshape risk sentiment across all asset classes.

 

Source: https://e27.co/gold-jumps-6-1-per-cent-to-us4946-as-geopolitical-tensions-override-dollar-weakness-what-about-bitcoin-20260204/

Anndy Lian is an early blockchain adopter and experienced serial entrepreneur who is known for his work in the government sector. He is a best selling book author- “NFT: From Zero to Hero” and “Blockchain Revolution 2030”.

Currently, he is appointed as the Chief Digital Advisor at Mongolia Productivity Organization, championing national digitization. Prior to his current appointments, he was the Chairman of BigONE Exchange, a global top 30 ranked crypto spot exchange and was also the Advisory Board Member for Hyundai DAC, the blockchain arm of South Korea’s largest car manufacturer Hyundai Motor Group. Lian played a pivotal role as the Blockchain Advisor for Asian Productivity Organisation (APO), an intergovernmental organization committed to improving productivity in the Asia-Pacific region.

An avid supporter of incubating start-ups, Anndy has also been a private investor for the past eight years. With a growth investment mindset, Anndy strategically demonstrates this in the companies he chooses to be involved with. He believes that what he is doing through blockchain technology currently will revolutionise and redefine traditional businesses. He also believes that the blockchain industry has to be “redecentralised”.

www.anndy.com
j j j

Gold hits US$5K and crypto bleeds: What comes next?

Gold hits US$5K and crypto bleeds: What comes next?

As global markets opened for trading on Monday, January 26, investors found themselves navigating a landscape shaped by escalating geopolitical friction, shifting monetary expectations, and a historic surge in gold prices that eclipsed the psychological US$5,000 per ounce threshold. The confluence of these forces has created a volatile yet revealing moment in financial history. This moment reflects not only immediate market reactions but also deeper structural anxieties about the stability of traditional financial systems, the role of safe-haven assets, and the fragile confidence underpinning both equities and digital assets.

Gold’s ascent to over US$5,000 an ounce marks more than just a new record. It signals a profound loss of faith in fiat stability and institutional safeguards. This rally did not emerge in isolation. It unfolded against a backdrop of weakening US dollar sentiment, driven by fears of Japanese intervention in currency markets and renewed speculation about potential US tariffs targeting Greenland. A move that, while seemingly niche, underscores the broader trend of economic nationalism and strategic resource competition. In such an environment, capital naturally seeks refuge.

Gold, with its millennia-long reputation as a store of value, becomes the default destination when trust in policy predictability erodes. The strength of gold-related equities in Hong Kong, which helped propel the Hang Seng Index to its fourth consecutive gain, further illustrates how this flight to safety is translating into real portfolio allocations across Asia.

Meanwhile, US stock futures pointed lower at the open, reflecting investor caution ahead of a critical earnings week. The tech sector, long the engine of market returns, now stands at a crossroads. Microsoft, Meta, Tesla, and Apple are all scheduled to report results, and their performance will likely dictate whether the Nasdaq can sustain its narrow 0.28 per cent gain from Friday, January 23, when it closed at 23,501.24. That modest advance stood in stark contrast to the broader market malaise. The S&P 500 barely held onto a 0.03 per cent rise to finish at 6,915.61, while the Dow Jones Industrial Average tumbled 285.30 points, or 0.58 per cent, to 49,098.71, dragged down by a nearly 4 per cent drop in Goldman Sachs. These divergences suggest growing selectivity among investors, who are increasingly unwilling to reward broad market exposure without clear earnings justification, especially in a climate where macro risks loom large.

In Asia, policymakers are responding with strategic moves aimed at reinforcing regional financial autonomy. The Hong Kong Monetary Authority’s decision to double the size of its RMB Business Facility to RMB200 billion (US$28 billion) is a deliberate step toward deepening offshore renminbi liquidity and reducing reliance on the US dollar in trade and settlement. This aligns with China’s long-term goal of internationalising its currency, particularly as geopolitical tensions incentivise alternative financial architectures. Meanwhile, Singapore’s central bank is expected to hold its monetary policy steady, reflecting a more cautious stance in a region where inflation dynamics remain manageable but external shocks could quickly alter the calculus.

The cryptocurrency market, however, tells a different story, one of fragility and systemic vulnerability. Over the past 24 hours, the total crypto market cap fell by 1.9 per cent, extending a seven-day decline of 6.94 per cent. Despite retaining a modest 0.63 per cent gain for the month, the recent slide reveals how quickly sentiment can turn when trust is breached.

Two major security incidents acted as catalysts. In South Korea, prosecutors confirmed a phishing attack led to staggering losses of seized Bitcoin, while in the US, 40 million dollars worth of crypto was stolen from government-controlled addresses. These were not random hacks. They targeted institutions entrusted with custody of digital assets, raising urgent questions about the adequacy of current safeguards. When even state-held crypto proves vulnerable, retail and institutional participants alike reassess their exposure.

This erosion of confidence triggered a cascade of forced selling. In just 24 hours, 145 million dollars in Bitcoin long positions were liquidated, a staggering 4,829 per cent increase from baseline levels, with longs accounting for 98 per cent of all liquidations. Simultaneously, open interest in Bitcoin derivatives rose by 14 per cent, indicating that traders had piled into leveraged bets just before the downturn. The result was a classic deleveraging spiral.

As prices dipped below key technical supports, margin calls triggered automated sell-offs, which pushed prices lower, triggering more liquidations. Funding rates have turned slightly negative at minus 0.001 per cent, suggesting that short-term sentiment has shifted bearish, though not yet into panic territory. Still, the speed and scale of the unwind reveal how thin the line remains between orderly correction and disorderly collapse in highly leveraged crypto markets.

From my view, these developments underscore a pivotal tension in today’s financial ecosystem. There is a growing divergence between traditional safe-haven behaviour and the still-unproven resilience of digital alternatives. Gold’s record high reflects centuries of accumulated trust, while crypto’s sharp pullback exposes its continued dependence on speculative leverage and institutional credibility, both of which remain works in progress. The thefts from government-held wallets are particularly damning because they strike at the very premise that regulated custody can mitigate risk. If even federal agencies cannot secure digital assets, what hope do exchanges or self-custody solutions offer to the average investor?

Moreover, the timing could not be more consequential. With the US Senate set to discuss a new crypto bill this week, regulators now face immense pressure to respond, not just with rhetoric, but with concrete frameworks that address custody standards, transparency, and systemic risk. A reactive crackdown could deepen the selloff, while a measured, innovation-friendly approach might restore some confidence. But given the current mood, shaped by both geopolitical uncertainty and market fragility, any misstep could accelerate capital flight from digital assets toward time-tested stores of value.

Today may be remembered not just for gold’s historic milestone, but as a stress test for the entire architecture of modern finance. Traditional markets are grappling with slowing momentum and earnings uncertainty. Asian economies are quietly building parallel financial rails. The crypto sector is confronting its Achilles’ heel, the gap between technological promise and operational reality. For investors, the path forward demands discernment. Blind faith in either legacy systems or decentralised ideals is no longer tenable. Instead, survival and profit will belong to those who can navigate this hybrid landscape with eyes wide open, recognising that true resilience lies not in ideology, but in adaptability.

 

Source: https://e27.co/gold-hits-us5k-and-crypto-bleeds-what-comes-next-20260126/

Anndy Lian is an early blockchain adopter and experienced serial entrepreneur who is known for his work in the government sector. He is a best selling book author- “NFT: From Zero to Hero” and “Blockchain Revolution 2030”.

Currently, he is appointed as the Chief Digital Advisor at Mongolia Productivity Organization, championing national digitization. Prior to his current appointments, he was the Chairman of BigONE Exchange, a global top 30 ranked crypto spot exchange and was also the Advisory Board Member for Hyundai DAC, the blockchain arm of South Korea’s largest car manufacturer Hyundai Motor Group. Lian played a pivotal role as the Blockchain Advisor for Asian Productivity Organisation (APO), an intergovernmental organization committed to improving productivity in the Asia-Pacific region.

An avid supporter of incubating start-ups, Anndy has also been a private investor for the past eight years. With a growth investment mindset, Anndy strategically demonstrates this in the companies he chooses to be involved with. He believes that what he is doing through blockchain technology currently will revolutionise and redefine traditional businesses. He also believes that the blockchain industry has to be “redecentralised”.

www.anndy.com
j j j

Bitcoin just broke US$94K: Here’s what the Fed’s next move means for your portfolio

Bitcoin just broke US$94K: Here’s what the Fed’s next move means for your portfolio

The global financial markets entered a holding pattern this week, caught between resilient labour market data and the looming Federal Reserve decision. Investors showed restraint, refraining from aggressive positioning as they awaited clarity on interest rate policy, but beneath the surface of this apparent calm, a subtle recalibration of risk sentiment was already underway.

In traditional markets, mixed equity performance, rising Treasury yields, and a firmer dollar reflected persistent uncertainty. In a parallel universe, the crypto market surged more than two per cent in just 24 hours, driven by a confluence of technical, institutional, and regulatory forces that suggest a growing divergence in how macro signals are interpreted between legacy finance and digital assets.

The US labour market continues to defy expectations of softening. The latest JOLTS report revealed job openings rose to US$7.67 million in the September to October period, well above the US$7.15 million forecast. This data point reinforces the narrative of underlying economic strength, which in turn complicates the Federal Reserve’s path toward easing.

Despite this, many strategists still anticipate a 25 basis point rate cut at the December FOMC meeting. Such an expectation hinges on the assumption that recent softness in inflation readings and subtle shifts in labour dynamics will ultimately outweigh the headline strength in job openings.

Treasury yields responded accordingly, with the 10-year yield climbing to 4.184 per cent and the two-year jumping to 3.611 per cent, signalling that markets remain sceptical about the durability of any dovish pivot. Meanwhile, the dollar edged higher, pushing USD JPY to 156.88, though expectations of a Bank of Japan rate hike in December could reverse that trend through narrowing yield differentials.

Within this traditional macro framework, equities exhibited fatigue. The S&P 500 dipped 0.1 per cent, the Dow Jones fell 0.38 per cent, and only the Nasdaq managed a modest gain of 0.13 per cent. This divergence within US indices underscores the market’s preference for growth-oriented tech exposure amid macro ambiguity.

Regional Asian equities mirrored this cautious tone, closing mixed as traders braced for the Fed’s verdict. The prevailing strategy calls for consolidation in portfolios, with a tilt toward non-US value and mid-cap plays to generate alpha, suggesting that global diversification remains a prudent hedge against US-centric policy risk.

But while traditional markets tread water, crypto roared back with conviction. Bitcoin rose 2.96 per cent, and Ethereum surged 9.02 per cent, lifting the broader market by 2.49 per cent. This move was not speculative froth but rather a technically driven rally with institutional fingerprints and regulatory validation.

At the heart of the action was a classic short squeeze. Over US$163 million in BTC shorts were liquidated in 24 hours, the largest such event since November 25, after prices vaulted above the 94,400 resistance level. This created a self-reinforcing cycle.

As shorts were forcibly closed, their covering purchases pushed prices higher, triggering even more margin calls. Perpetual futures funding rates, which had been negative for nearly 10 days, flipped positive to 0.00218 per cent, confirming a shift in trader sentiment from defensive to optimistic.

Crucially, this rally was not just retail-driven momentum. Institutional demand re-emerged with tangible force. US spot Bitcoin ETFs recorded US$1.55 billion in net inflows this week alone, reversing a period of outflows and pushing total assets under management to US$124.24 billion. This re-engagement suggests that institutional players view current levels as attractive entry points, especially if they anticipate a dovish tilt from the Fed.

Further evidence came from on-chain data showing a single entity, likely Bitmain, acquiring US$432 million worth of Ethereum, highlighting strategic accumulation at a time of macro uncertainty. Notably, crypto’s 24-hour correlation with the Nasdaq 100 spiked to 0.72, its highest since October. This strong linkage implies that both markets are responding to the same macro catalysts, namely softening Fed rhetoric and the potential for declining real yields, which historically serve as tailwinds for risk assets.

Perhaps most significant was the regulatory development from the Office of the Comptroller of the Currency. In Letter 1188, the OCC clarified that federally chartered banks can act as intermediaries for crypto transactions without holding the underlying digital assets on their balance sheets. This guidance removes a longstanding legal grey area and provides banks with a clear pathway to participate in the crypto ecosystem as service providers.

Coupled with the Commodity Futures Trading Commission’s launch of a tokenised collateral pilot, the regulatory landscape is shifting from adversarial to enabling, at least for institutions. The impact is twofold. On one hand, it reduces operational and compliance risk for traditional finance players looking to enter crypto markets.

On the other hand, it could inadvertently raise barriers for retail participants if compliance overhead increases. Still, the net effect is bullish, as institutional capital requires regulatory certainty before deploying at scale.

From a strategic standpoint, these developments align with a broader thesis. Crypto is evolving from a speculative asset class into a component of diversified institutional portfolios. The recent rally reflects not just a technical rebound but a recalibration of market structure. Leverage is being shed and rebuilt more sustainably, institutional inflows are stabilising spot prices, and regulatory clarity is lowering systemic friction. Even so, caution remains warranted.

The Fear and Greed Index sits at just 30 out of 100, signalling that market participants are still operating from a defensive posture. Much now hinges on the Fed’s tone in its upcoming statement. A dovish signal, perhaps acknowledging progress on inflation or hinting at a December cut, could catalyse a broader risk-on rotation, extending gains across both equities and crypto.

One key question lingers. If Bitcoin dominance continues to wane, will altcoins like Ethereum and Solana sustain their momentum? Ethereum’s nearly 9 per cent surge suggests strong conviction in its post-merge fundamentals and institutional utility, especially as layer two adoption accelerates. Solana, though not mentioned in the data provided, often benefits from spillover demand during ETH rallies due to its high throughput architecture and growing DeFi activity. If the macro backdrop turns favourable, capital rotation into these higher beta assets could intensify.

In sum, while traditional markets remain in a holding pattern dictated by central bank uncertainty, crypto markets are exhibiting signs of structural maturation. The rally is not merely a reaction to price action but the result of deeper forces. Deleveraging, renewed institutional interest, and regulatory progress form the pillars of a healthier, more resilient market, one that may still be volatile but is increasingly influenced by fundamentals rather than pure sentiment.

As the Fed prepares to speak, all eyes will be on whether its message validates the growing optimism in risk assets or reins it in with a reminder of persistent inflationary pressures. Either way, crypto is no longer an isolated sideshow. It is now a barometer of institutional confidence and macro adaptation in a rapidly shifting financial landscape.

 

 

 

Source: https://e27.co/bitcoin-just-broke-us94k-heres-what-the-feds-next-move-means-for-your-portfolio-20251210/

Anndy Lian is an early blockchain adopter and experienced serial entrepreneur who is known for his work in the government sector. He is a best selling book author- “NFT: From Zero to Hero” and “Blockchain Revolution 2030”.

Currently, he is appointed as the Chief Digital Advisor at Mongolia Productivity Organization, championing national digitization. Prior to his current appointments, he was the Chairman of BigONE Exchange, a global top 30 ranked crypto spot exchange and was also the Advisory Board Member for Hyundai DAC, the blockchain arm of South Korea’s largest car manufacturer Hyundai Motor Group. Lian played a pivotal role as the Blockchain Advisor for Asian Productivity Organisation (APO), an intergovernmental organization committed to improving productivity in the Asia-Pacific region.

An avid supporter of incubating start-ups, Anndy has also been a private investor for the past eight years. With a growth investment mindset, Anndy strategically demonstrates this in the companies he chooses to be involved with. He believes that what he is doing through blockchain technology currently will revolutionise and redefine traditional businesses. He also believes that the blockchain industry has to be “redecentralised”.

www.anndy.com
j j j